MICHEL MARTIN, HOST:
Let's dig into this a bit more with Heather Long. She is the chief economist at Navy Federal Credit Union. Good morning. Thanks for joining us.
HEATHER LONG: Thanks for having me.
MARTIN: So we just heard President Trump at that Georgia rally yesterday asking voters to give him more time to lower costs, which is something he said he's been doing for more than a year.
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PRESIDENT DONALD TRUMP: It was a word, you know, made up by the Democrats, affordability. They said, affordability. I said, I've been here one day. Don't worry, I'll take care of it. And we're taking care of it.
MARTIN: Is there any way in which the Trump administration is making things more affordable?
LONG: It's still a really tough time for many Americans. Inflation is wiping out all of wage gains. And if you look at the main areas that most Americans are focused on when they think about affordability - you know, housing, groceries, electricity, childcare, medical care - they are all still very high, and in many cases, rising significantly. And that's why people - this issue is front of mind for so many Americans. People are having to dip into their savings. The best case I think he made yesterday was what he's doing around the TrumpRx to try to lower some prescription drug costs. But obviously, that only impacts, you know, about 12% of prescriptions out there. So it's still a modest impact so far.
MARTIN: You heard the president mention that inflation did get better in June. It's my understanding that was in large part because energy costs did ease with a pause in the fighting in the Iran war. Do you think it will get worse again now that the fighting with Iran has started up again?
LONG: It's inevitable that the July inflation data will rise again, probably be back close to 4%. Whether it hits 4 or 3.9, you know, it depends kind of where we end here on the gas price. But obviously, with gas back above $4, you know, that's adding $50 of cost to many American households. The diesel price is also up, and with almost every item in the U.S. spending some time on a truck, those costs will be passed along quickly.
MARTIN: I want to go to the question of tariffs. You know, the Supreme Court struck down most of Trump's tariffs on pretty much every country from last April. The administration has announced new tariffs since then, most recently against Canadian products. Is there any scenario in which this doesn't continue to raise prices for Americans?
LONG: (Laughter) Well, I guess if they don't actually get enacted, right? So, for instance, the ones that were announced on Canada, the threats of up to 15% on hockey sticks - wow, that's quite telling - wine products and cement. Those have about a month before they go into effect, so it's possible that they won't. But certainly, just looking at the numbers, at the inflation data, you can still see some pretty significant cost increases coming through, especially on things like appliances, some toys, tools. You know, some of those key imports are still pretty significant price increases due to tariffs.
MARTIN: And one of the president's arguments for tariffs is that it would encourage people to buy more things made in the U.S. and that it would, in fact, kind of lure manufacturing back to the U.S. Is there any sign of that happening?
LONG: No. No, not yet. And certainly, the numbers tell the story. Just looking at manufacturing jobs, which I think was really the heart of that argument, they are down. We are down 75,000 manufacturing jobs since January 2025. And I know that that continues to be a sector that many people would like to see revived.
MARTIN: Why is that? Why are manufacturing jobs down?
LONG: I think some of it is definitely due to the tariff pressures. But it is a cyclical industry. It's been a rough couple of years. It's not like all the pain started in January 2025 for that industry. And, but again, it just goes to how - I think it's the broader issue of how many Americans feel stuck right now, that there's a lack of opportunities. It's hard to buy a home. It's hard to get a job, whether you're in manufacturing or many other sectors.
MARTIN: So you've given us a lot to think about it. Are there any other indicators that you would look at to determine how Americans are doing?
LONG: We've covered a lot. I think the big surprise to me, listening to the president's speech, is he continues to really hold up the stock market as a sign that the economy is doing well. And certainly, the stock market is doing better than almost anyone expected this year. But I just remind people that over 40% of Americans have nothing in the stock market. The stock market is not the economy. And even with the Trump accounts, I think that has some, you know, real potential benefits. But it's kind of a head-scratcher why the administration isn't automatically enrolling every eligible child to ensure those benefits reach low-income Americans.
MARTIN: That's Heather Long. She's a chief economist at Navy Federal Credit Union. Heather Long, thank you so much for joining us.
LONG: Thank you. Transcript provided by NPR, Copyright NPR.
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